Recruiting has gotten off to a sluggish start this year

The pace of industry recruiting has remained lower since the onset of the pandemic and the work-from-home policies and travel restrictions that followed.

Advisory industry activity is off to a much slower start this year.

Total moves of advisers between firms in the first quarter were down 4% from the prior three months and 12% lower than the comparable period of 2021, according to the InvestmentNews Advisers on the Move database. The data exclude moves resulting from mergers and acquisitions, as well as those of advisers between related entities.

The pace of industry recruiting has remained lower since the onset of the pandemic and the work-from-home policies and travel restrictions that followed. Between the first and second quarters of 2020, total adviser moves fell 24%.

In the nine quarters before the pandemic, an average of 4,570 advisers changed firms each quarter. In the nine quarters since, the average has fallen to 3,893.

Although recruiting activity did ultimately rebound somewhat in 2021, the 3,652 advisers on the move in the first quarter was the lowest since the immediate aftermath of the pandemic in the second quarter of 2020.

While a return to in-person events and the lifting of many travel restrictions is sure to facilitate more adviser networking and perhaps an uptick in recruiting, the recent drop in activity also coincides with a sustained period of market volatility. Jittery clients and fluctuations in asset valuations could complicate the jump for some advisers.

NOT SO GREAT EXPECTATIONS

According to recent InvestmentNews Research polling data, only 58% of advisers expect equity markets to improve over the next 12 months, while 30% expected them to decline. Perceptions of the overall economy were entirely underwater, with only 32% expecting it to improve and 57% expecting it to worsen. On both fronts, sentiment was also at its lowest since the immediate fallout of the pandemic.

While overall recruiting activity is down, the RIA and independent broker-dealer channels continue to attract experienced advisers on net, gaining 341 and 207 advisers, respectively, this quarter. Meanwhile, wirehouses lost 522 advisers on net.

Q1 Top Net Gains

Q1 Top Net Gains	Advisers Gained

LPL Financial	149
Fidelity Brokerage Services	98
Raymond James Financial Services Inc.	49
Citigroup Global Markets Inc.	44
Morgan Stanley	37
GWFS Equities Inc.	31
Cambridge Investment Research Inc.	29
Citizens Securities Inc.	27
Raymond James & Associates Inc.	23
Fisher Investments	23
RBC Capital Markets	23

Q1 Top Net Losses

Q1 Top Net Losses	Advisers Lost

Merrill Lynch Pierce Fenner & Smith Inc.	302
Wells Fargo Clearing Services	230
Edward Jones	94
HSBC Securities (USA) Inc.	69
NYLife Securities	44
MML Investors Services	35
UBS Financial Services Inc.	27
Securities America Inc.	27
Northwestern Mutual Investment Services	26
Equitable Advisors	23